Walmart-owned PhonePe is opening its mobile app store to developers, Moneycontrol has learnt, as the fintech company looks to challenge the Google-Apple duopoly in mobile app distribution.
Called Indus Appstore, the mobile app marketplace is inviting Android app developers to publish their app on the platform, and will charge a zero percent fee on in-app purchases, Moneycontrol has learnt. In comparison, Google and Apple levy a 15-30 percent fee from developers on in-app purchases and paid app sales.
PhonePe has confirmed the launch of Indus Appstore developer platform after the story was published. It also said the app listings on the platform will be free for the first year, following which a "nominal" annual fee will be charged.
At a subsequent launch event held on September 23, PhonePe co-founder Sameer Nigam said that developers will be able to integrate any payment gateway of their choice on the platform.
"India is poised to have over 1 billion smartphone users by 2026 offering us a massive opportunity to build a new-age, localized Android app store. Despite being such a large consumer market, app developers have always been forced to work with only one app store - Google Playstore - for distributing their apps" said Akash Dongre, co-founder, Indus Appstore.
"Indus Appstore hopes to provide app developers a credible alternative to the Google Playstore - one that is more localized and offers better app discovery and consumer engagement" he added.
The app store will allow developers to list their apps in 12 Indian languages apart from English as well as upload media and videos to their app listings in these languages.
Indus Appstore claims to offer a 24x7 dedicated India-based support via email or chatbot with "assured assistance and quick resolution of queries", in a bid to address a common pain point that developers have often faced with Google and Apple. The platform will also offer dedicated account managers.
The app store will also offer "developer friendly and transparent" policies, according to its website.
Indus Appstore will also soon launch a consumer-facing app. At the event, Nigam said that users will be able to download and "sideload" the app on their smartphones in the coming months.
The company has also struck partnerships with OEMs (original equipment manufacturer) such as Nokia and Motorola to integrate the app store to their devices.
"Dream11 and other apps have shown that you don't need to go through the gateway called Play Store to get popular. We hope the OEMs will open up, right now there's just no conversation happening (among the larger OEMs). But we will prove, by consumer demand and developer demand, that they will have to bow. We will make sure that we have the best localized experience" he said.
The Indus Appstore app will have sections such as featured apps, top apps, top games and news apps and dedicated tabs for games, explore page, and managing their account activity. One can also toggle between languages to view the apps in their preferred language.
It will also feature a search bar to allow users to search for their preferred apps and games. To help users discover new apps, the app store offers a carousel of short videos in a format similar to Instagram Stories that users can view and download the app directly from the video.
This is alongside a featured app carousel and a row of app recommendations.
The app store will offer a mobile number-based login system to attract consumers without email accounts.
Regulatory scrutiny over app store practices
This launch comes at a time when Google and Apple are facing regulatory scrutiny over the business practices of their app marketplaces Google Play and App Store in India and several other markets.
In October last year, the country's antitrust watchdog Competition Commission of India (CCI) had directed the tech giant to modify its conduct towards smartphone makers and app developers through a range of corrective measures besides imposing a penalty through two separate orders.
As part of these measures, CCI had directed Google to allow third party app stores on Google Play, however The National Company Law Appellate (NCLAT) had subsequently set aside this direction in March 2023.
In recent years, Google has also faced intense backlash from Indian developers over its app policies, particularly after the search giant's announcement in October 2020 that it will begin enforcing a mandatory integration of its Play billing system across the world. Several app developers have mentioned that these commission fees are "extremely high" and "unfair".
Since then, Google has taken several steps to modify its policies including lowering its commission fee and introducing third party billing for in-app purchases. The tech giant claims that these changes comply with the CCI's order, but many local app developers disagree and have challenged it in the court.
Indus OS acquisition
That said, the launch of Indus Appstore has been on the cards for a while. In July 2022, PhonePe had acquired an indigenous Android content and app discovery platform Indus OS after a long protracted legal battle.
In April 2023, PhonePe co-founder Sameer Nigam had confirmed plans of building an app store in an interview with Moneycontrol. At the time, the company also said that it was in talks with OEMs to integrate the app store.
Apart from the annual fees, Indus Appstore will likely monetise its offering through advertising and value added services for developers. App marketers can get "boosted visibility" on search, promote their apps on dedicated video slots and run custom targeted ad campaigns. according to the website. One can also create rich media ads in Indian languages and avail translation services from experts, likely to enable developers to list apps in various Indian languages.
For developers, Indus Appstore will offer the ability to roll out newer app versions to relevant user cohorts, test features with a select audience and have better control over their app releases. It will also offer real-time tracking of app installs and uninstalls, exploring competitor trends and a "transparent rating system".
It's worth noting that PhonePe already offers a 'Switch' platform on its eponymous payments app, that offers users an app-like experience across a range of categories including food, grocery, shopping, travel, and healthcare among others.
PhonePe rival Paytm also offers a similar mini app store that offer users an app-like experience through a collection of custom built mobile websites.
Founded in December 2015 by Nigam, Rahul Chari, and Burzin Engineer, PhonePe has amassed over 480 million registered users until now. It is currently in the process of raising $1 billion funding across multiple tranches at a valuation of $12 billion. So far, it has raised over $850 million this year from investors such as General Atlantic, Tiger Global, Ribbit Capital, TVS Capital and its parent firm Walmart.
This fundraise follows the company’s spin-off from e-commerce major Flipkart, which was announced in December. The Flipkart spin-off also completed PhonePe's transition to a fully Indian-domiciled company, a process that began in 2022.
In the past year, PhonePe has moved into newer areas such as digital commerce with Pincode, stock broking with Share.market, Account Aggregator (AA) services, online payment gateways, and point-of-sale devices among others.
The Bengaluru-based firm is also scaling up its financial services offerings that includes mutual funds and insurance, and its flagship digital payment business, where it is currently the market leader with around 47 percent market share in terms of monthly volumes for the month of August 2023.
Note: The story has been updated with PhonePe's statement and additional information from the Indus Appstore launch event.
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